Title: Optimal Development and Economics of Shale Gas to LNG
Liquefied Natural Gas (LNG) has become an important technology for the transportation of natural gas supplies over a long distance to areas where it is high demanded. The aim of this paper focuses on the technical and economic analysis of the potential for developing two US shale gas plays and determining the potential value of shale gas to LNG for export to the overseas natural gas market. Due to availability of large shale gas reserves combined with current market growth and low domestic natural gas prices has driven numerous gas producers in U.S to consider natural gas monetisation option such as gas export to more profitable markets in Asia in form of LNG. This has prompted a large development in LNG business. Last year, global LNG traded volumes reached a historic high of 258 million metric tonnes per annum (MMTPA) with the demand expected to rise more than 50% to about 500 MMTPA over the next 20 years. To sustain this LNG demand growth, natural gas reserves from shale plays like the Haynesville and Marcellus need to be further exploited with increased development of horizontal drilling. This paper analyses production behaviour of shale gas wells with different horizontal well lengths in Haynesville and Marcellus shale plays in the interest of economic development of an LNG plant. Currently, the proposed LNG train capacity is evaluated to yield between 4-5 MMTPA, which will require a daily gas production of 600-700 million standard cubic feet per day (MMSCFD). For a shale gas to LNG project to be economically viable, the available natural gas reserves should be sufficiently large to supply and maintain an LNG train at full capacity for a designed period. This is evaluated using average single well production profile from two shale plays by considering the number of horizontal shale gas wells to be drilled, decline gas production rates, gas price, facilities cost needed to supply two LNG trains at full capacity for 20 years.